Despite Protests, Non-Compete Clause Likely To Remain In Bill For Downtown Music Festival

Aldermen have delayed a vote on a measure that could bring two Lollapalooza-like festivals to St. Louis a year.

(via Flickr/alaina.buzas)

St. Louis aldermen have temporarily slowed the progress of a measure that would reserve Memorial and Labor Day weekends for a new music festival in downtown St. Louis for at least the next 10 years.

The city's tourism committee heard two hours of testimony on the measure today. Chairman Joe Vollmer delayed the vote by a week to give its members time to digest the bill. A good portion of the 29-member Board of Aldermen sat in for at least part of the hearing.

The new version of the proposal serves to clarify the non-compete provision. As originally introduced, the city agreed not to issue permits to for-profit music events that were "substantially similar" to the proposed shows. Established acts like LouFest, Live on the Levee, Big Muddy Blues Festival and Fair St. Louis were grandfathered in.

The new non-compete clause added a definition of "substantially similar:"

For-profit, two or three-day music multi-stage music festival.

A ticket is required for admission.

25,000 tickets must be offered for sale to the public on each of the days.

Featuring country or rock music.

Have a budget of $8 million or more.

Be produced by a for-profit organization.

The shows that were grandfathered in under the first proposal remain the same. However, they would be prohibited from taking place in the area from roughly Broadway west to 22nd Street along Market.In exchange, ICM Partners, the Los Angeles-based company that would produce the new festivals, agreed to not produce other big festivals in cities within a 350-mile radius on those two weekends. That means ICM couldn't set up festivals in Chicago, Nashville or Kansas City on Memorial Day or Labor Day weekends.

The new language also makes it clear that the city of St. Louis cannot issue permits to big shows for the entire period between Memorial Day and Labor Day.

ICM is willing to continue negotiating on the exact language of the measure, said Randy Freedman, the company's senior director of business and legal affairs. But he called the non-compete clause crucial.

"This is a venture, that as I hope you can tell by the time that we've put into drafting this and what we're proposing in terms of revenue for the city, that is going to take substantial investment and substantial time," Freedman said. "If we have two festivals that bookend the summer, and then learn that the city has permitted a similar festival drawing on similar talent, drawing on similar sponsors, to land on Aug. 1, that severely detracts from the commercial viability and the survivability of this."

Mayor Francis Slay said both sides need to keep talking.

When the team that books talent for Bonnaroo, Coachella, SXSW wants to do its own festival here, we find a way to agree. #fgs

The yet-unnamed festival "will make the music scene in St. Louis explode," Alderman Phyllis Young, the sponsor, told the committee Thursday morning. It could be good for the city's pocketbooks as well.

ICM isn't getting a break on earnings or sales taxes, so the concerts could mean as much as $6 million in new direct revenue to the city, plus an untold amount generated by people spending money in the region. Because concert tickets aren't subject to the amusement tax as the result of a 20-year-old law, ICM has agreed to pay at least $50,000 to make up for that revenue. In addition, they will pay $400,000 for the use of city services like police, fire and trash, contracting with private companies if additional help is needed.

But all those provisions aren't enough to convince opponents that a non-compete clause is a good idea.

"There is absolutely no need for this ordinance," said event producer Mike Kociela. He said the city has existing rules and regulations governing festivals held around the city.

"The St. Louis City Office of Special Events already has an ordinance in place that addresses this exact issue. Why would we consider passing an ordinance that gives an unfair advantage to one business over another?" he said.

Kociela's Entertainment St. Louis puts on Bluesweek and Taste of St. Louis, both of which will be held in Chesterfield this year. He says he moved Bluesweek in part because of the non-compete clause. And he's worried it could crush the Big Muddy Blues Festival, which is grandfathered in but is always held on Labor Day weekend on Laclede's Landing.

"We are one of the very few authentic blues cities in America," he said. "The message that is being sent is that we do not value St. Louis's cultural heritage as an economic commodity."

Tara Pham, a former editor of Eleven Magazine, urged the aldermen to understand the history of Lollapalooza, which ICM has used for comparison in talking about the proposed festivals in St. Louis.

"Lollapalooza as we know it today is only eight years old," she said, referring to the fact that Lollapalooza is now a larger, mainstream event. "The festival that's described in the non-compete clause actually described something much smaller. So, by approving the current non-compete, you are actually forbidding much smaller festivals that are the Lollapalooza-to-be from starting up in St. Louis."

The timeline

With the delayed committee vote, the earliest the measure can get to Mayor Slay's desk is April 14, which is the last day of the current aldermanic session. Though it appears to have enough support, any further delay would require sponsors to re-introduce the measure next session.

ICM had the option to produce a show this coming Labor Day. Officials at the meeting said the delayed vote means the first concert will likely be held in May 2015, when the agreement officially starts.